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      02-18-2020, 11:19 AM   #1
PA20__VMemmmfour
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Personal Bank loan not approved, try dealer?

So I applied for a loan through BOA and did not get approved. Loan was for about 45k and price of m4 is roughly 47k not including taxes and other fees. I really want the vehicle, do you guys think I should let the dealer find me one or suck it up and wait till I solve my dti( which is not terrible) ? I know it's not guaranteed but that's my only other option. What do you guys think.

Last edited by PA20__VMemmmfour; 02-18-2020 at 11:34 AM..
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      02-18-2020, 11:51 AM   #2
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I think you should buy something within your budget. And if you did have good credit and low debt to income I would always finance through the dealer because, in my experience, their rates are always better than big name banks.
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      02-18-2020, 11:55 AM   #3
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Take it as a clear indication that you cannot afford this right now
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      02-18-2020, 12:47 PM   #4
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Take it as a clear indication that you cannot afford this right now
Very true. So your taking a loan for the full amount of the purchase price ?
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      02-18-2020, 01:16 PM   #5
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Pretty much, I was initially going to put down roughly 8k but instead I wanted to use the 8k to pay the taxes and fees, with the left over being put on the side just to have 3 to 4 monthly's ahead of time, cause you never know what can happen.
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      02-18-2020, 01:20 PM   #6
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At this point, I'm fairly certain you won't get any favorable interest rate...if you are getting above 4.5-5% then I would rethink this whole thing. If it's just a matter of building a better credit score, work on that for a year before considering this purchase!
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      02-18-2020, 02:38 PM   #7
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Take it as a clear indication that you cannot afford this right now
Agreed.
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      02-18-2020, 02:42 PM   #8
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Quote:
Originally Posted by PA20__VMemmmfour View Post
Pretty much, I was initially going to put down roughly 8k but instead I wanted to use the 8k to pay the taxes and fees, with the left over being put on the side just to have 3 to 4 monthly's ahead of time, cause you never know what can happen.
How much left over funds do you have every month after paying ur expenses ?
To get a loan approved you should of put a good amount down. So Iím speculating that you donít have much saved. Probably over ur head with this vehicle.
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      02-18-2020, 04:18 PM   #9
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To get a loan approved you should of put a good amount down.
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
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      02-18-2020, 04:36 PM   #10
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Originally Posted by flipnkraut View Post
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
I stated OP should of put a good amount down to get it approved...
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      02-18-2020, 04:40 PM   #11
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Quote:
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Quote:
Originally Posted by flipnkraut View Post
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
I stated OP should of put a good amount down to get it approved...
Might as well tell him to pay the whole thing in cash. If you can't get approved without anything down you can't afford the car.
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      02-18-2020, 06:56 PM   #12
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Quote:
Originally Posted by flipnkraut View Post
Quote:
Originally Posted by LIF83 View Post
Quote:
Originally Posted by flipnkraut View Post
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
I stated OP should of put a good amount down to get it approved...
Might as well tell him to pay the whole thing in cash. If you can't get approved without anything down you can't afford the car.
lol what? Putting money down is a personal decision and generally has nothing to do with being able to "afford it". Net worth and current/future earnings are much more of a factor in terms of affordability. People do anything from financing 100% of the purchase to stroking a check and paying in full up front depending on what works best for them. Most people use a down payment to control monthly payments as a form of budgeting.
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      02-18-2020, 07:10 PM   #13
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Quote:
Originally Posted by gatorfast View Post
Quote:
Originally Posted by flipnkraut View Post
Quote:
Originally Posted by LIF83 View Post
Quote:
Originally Posted by flipnkraut View Post
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
I stated OP should of put a good amount down to get it approved...
Might as well tell him to pay the whole thing in cash. If you can't get approved without anything down you can't afford the car.
lol what? Putting money down is a personal decision and generally has nothing to do with being able to "afford it". Net worth and current/future earnings are much more of a factor in terms of affordability. People do anything from financing 100% of the purchase to stroking a check and paying in full up front depending on what works best for them. Most people use a down payment to control monthly payments as a form of budgeting.
Let me state it again since you missed it. If you _have to put money down in order to get approved_, you don't have enough money to afford the car. If you _choose_ to put money down, that's on you, but if you are required to put money down then you can't afford the car.

As far as paying cash, why would I tie my money up in a depreciating asset, when I can finance it at less than 3% and instead invest that money making me 8%.

And if you're concerning yourself with the monthly payment instead of what you're ultimately paying for the car, you're making a poor financial decision.
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      02-18-2020, 07:41 PM   #14
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Quote:
Originally Posted by flipnkraut View Post
Quote:
Originally Posted by gatorfast View Post
Quote:
Originally Posted by flipnkraut View Post
Quote:
Originally Posted by LIF83 View Post
Quote:
Originally Posted by flipnkraut View Post
That's not true at all. Putting money down on a car in order to afford the payments means you can't afford the car. If you can afford the car then you can afford to not put anything down and also get a <3% rate (depending on what interest rates are at the time). You can make more investing than that interest rate so it makes no sense to put money down unless you couldn't afford the car to begin with. If you are smart you can also take advantage of the banks taking advantage of gullible people and get the longest term loan and pay it as if it were a 36 month loan. You'll actually end up paying off the car a month or two earlier and pay about the same in interest. And plus side is you'll never be upside down on the loan.
I stated OP should of put a good amount down to get it approved...
Might as well tell him to pay the whole thing in cash. If you can't get approved without anything down you can't afford the car.
lol what? Putting money down is a personal decision and generally has nothing to do with being able to "afford it". Net worth and current/future earnings are much more of a factor in terms of affordability. People do anything from financing 100% of the purchase to stroking a check and paying in full up front depending on what works best for them. Most people use a down payment to control monthly payments as a form of budgeting.
Let me state it again since you missed it. If you _have to put money down in order to get approved_, you don't have enough money to afford the car. If you _choose_ to put money down, that's on you, but if you are required to put money down then you can't afford the car.

As far as paying cash, why would I tie my money up in a depreciating asset, when I can finance it at less than 3% and instead invest that money making me 8%.

And if you're concerning yourself with the monthly payment instead of what you're ultimately paying for the car, you're making a poor financial decision.
I didn't miss anything. I just think your hardline stance and opinion on what constitutes affordability is misguided.

I love how this is always the rationale for putting down less money and financing more. Like there are so many 100% safe investments out there which yield a high return thereby making it foolish to use cash elsewhere. This is much more of an academic answer than a real world and practical answer imo.

And finally, nowhere did I mention that overall cost of ownership was not important. However, that is only realized once you dispose of the vehicle. For the ownership period though, most people budget in terms of monthly cash outflow. This is what I was referring to when I mentioned the down payment can be used to manage monthly payment.
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      02-18-2020, 07:55 PM   #15
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You'll be surprised how many F80 owners can't afford the car. If you're making less than 120k a year you shouldn't even consider buying this car unless you have no bills and live with mommy and daddy.
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      02-18-2020, 08:50 PM   #16
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You'll be surprised how many F80 owners can't afford the car. If you're making less than 120k a year you shouldn't even consider buying this car unless you have no bills and live with mommy and daddy.
These cars can be purchased in the $3x,xxx range it doesnt take a 6 figure salary to afford one. Especially in some areas where housing is sub 1k per month
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      02-18-2020, 08:51 PM   #17
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Completely agree with all, but I made the mistake by not getting rid of some cc's, and other loans. So plan is to eliminate some debt within 2 months or more. Probably going to use the 8k for that. Hopefully by then it should be ok to try again.
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      02-18-2020, 09:07 PM   #18
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Quote:
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Quote:
Originally Posted by Andrae26 View Post
You'll be surprised how many F80 owners can't afford the car. If you're making less than 120k a year you shouldn't even consider buying this car unless you have no bills and live with mommy and daddy.
These cars can be purchased in the $3x,xxx range it doesnt take a 6 figure salary to afford one. Especially in some areas where housing is sub 1k per month
Even if the car is in the 30's an ideal income for that would be 90k +. Let's say car is 35k, you're making 70k then DTI is 50% unless you put down quiet a bit. Cheaper areas generally comes with less pay no?
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      02-19-2020, 11:08 AM   #19
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I think you should buy something within your budget. And if you did have good credit and low debt to income I would always finance through the dealer because, in my experience, their rates are always better than big name banks.
BMW FS rates fluctuate way more than regular banks. When we bought my wife's 2018 M3, our credit union had better rates than BMW FS, but we did Euro Delivery so we had to finance through BMW FS. Once the car was redelivered, we refinanced at our credit union for almost a full percent less.

Neither was as good as the BMW FS rate of 0.9% on my 2016 M4.
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      02-19-2020, 04:13 PM   #20
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Quote:
Originally Posted by Andrae26 View Post
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Originally Posted by rapsquared View Post
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Originally Posted by Andrae26 View Post
You'll be surprised how many F80 owners can't afford the car. If you're making less than 120k a year you shouldn't even consider buying this car unless you have no bills and live with mommy and daddy.
These cars can be purchased in the $3x,xxx range it doesnt take a 6 figure salary to afford one. Especially in some areas where housing is sub 1k per month
Even if the car is in the 30's an ideal income for that would be 90k +. Let's say car is 35k, you're making 70k then DTI is 50% unless you put down quiet a bit. Cheaper areas generally comes with less pay no?
That's not how DTI works...
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      02-20-2020, 12:45 PM   #21
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That's not how DTI works...
lol
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      02-21-2020, 11:33 PM   #22
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hold off on the car man. you said "cc'd and other loans". No offense but it sounds like you're in debt up to your eyeballs and about to get into more debt on a car that's still on the steep part of the depreciation curve.

Pay off your debt first, buy the car when you're financially ready. Banks are handing out money like hotcakes nowadays so if you got denied, that is a sign that you're stretched a bit too thin.

instant gratification can be tempting, but you'll likely regret it down the line.
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